Global energy sector is entering a decade of rapid change: overall demand keeps rising, electricity use is accelerating, and most new capacity and investment are flowing into renewable energy and electrification. Forecasts show fossil fuel demand peaking before 2030 in mainstream scenarios, while renewables, grids, and flexibility solutions drive the bulk of future growth.
Global Energy Demand and the “Age of Electricity”
Global energy demand is still growing as population, incomes, and industrialization increase, but the growth is increasingly electricity‑led.
The IEA World Energy Outlook 2025 describes an “explosive” rise in electricity demand over the next decade, driven by the electrification of transport, buildings, and industry. In its core Stated Policies Scenario, the IEA projects that global electricity demand will increase by roughly 40% by 2035, and by more than 50% in its net‑zero pathway. You can reference the full analysis in the World Energy Outlook 2025 – IEA.
A regional summary from InsiderPH notes that global electricity demand is expected to grow by around 3.6% annually through 2030, with Asia‑Pacific accounting for most of the increase. Rising air‑conditioning loads, expanding commercial activity, and rapid EV adoption are key drivers, as discussed in INSIDER VIEW: Electricity demand forecast through 2030.
By around 2030, renewables plus nuclear are expected to provide roughly half of global electricity generation, up from about 40% today. Iberdrola’s summary of the IEA outlook, IEA WEO 2025: Electrification, the most cost-effective and sustainable solution, highlights electrification as the central pillar of future global energy‑sector growth.
Renewable Energy Market Growth Forecast
The renewable energy market is expected to grow significantly faster than the overall energy sector and will capture most of the new investment and capacity.
Next Move Strategy Consulting estimates that the global renewable energy market size was about USD 856.1 billion in 2021 and is forecast to reach USD 2,025.9 billion by 2030, implying a 9.6% CAGR from 2022 to 2030. You can cite these figures directly from Renewable Energy Market Size & 2030 Forecast – NextMSC.
Statista’s global overview suggests that the market value of the renewable energy industry will exceed USD 2 trillion by 2030, based on a similar growth rate of around 9.6% per year between 2022 and 2030. See Market value of renewable energy industry worldwide 2030.
MarkNtel Advisors project that the global renewable energy market will grow from roughly USD 1,080 billion in 2024 to USD 1,918 billion by 2030, at a 12.2% CAGR from 2025 to 2030. Their analysis, Renewable Energy Market Size, Share & Growth, breaks down this growth by region and technology (solar, wind, hydro, bioenergy).
Fortune Business Insights similarly forecasts the renewable energy market rising from about USD 1,078.7 billion in 2025 to roughly USD 1,838.6 billion by 2032, underscoring the sector’s strong medium‑term growth trajectory. You can reference this at Renewable Energy Market Size, Share & Trends.
The United Nations notes that rapidly scaling renewable power could enable renewables to supply around 65% of global electricity by 2030 and help reduce up to 90% of power‑sector CO₂ emissions, if countries deliver on their climate commitments. See the UN’s overview, Renewable energy – powering a safer and prosperous future.
Capacity Additions and Technology Shifts to 2030
Forecasts show a major build‑out of renewable generation and supporting infrastructure through 2030.
An IEA‑based analysis from Energy Tracker Asia finds that global renewable power capacity is on track to double by 2030, with around 4,600 GW of new capacity expected—about the current total power capacity of China, the EU, and Japan combined. Details are in Renewable Energy Trends 2025: Capacity to Double by 2030.
According to this outlook:
- Renewables are set to become the largest global source of electricity, supplying nearly 45% of global power by 2030.
- Renewable electricity generation is projected to rise roughly 60%, from about 9,900 TWh in 2024 to 16,200 TWh in 2030.
An ICAEW report synthesizing IEA data, Renewables 2024: Analysis and forecast to 2030, notes that annual renewable capacity additions could reach close to 940 GW by 2030, which is about 70% higher than the previous record year. It also projects that by 2030:
- Renewables will generate about 46% of global electricity, with wind and solar together providing around 30%.
- Solar and wind will represent roughly 95% of new capacity additions, while hydropower growth slows.
These trends imply growing needs for grid modernization, storage, and flexibility solutions, as variable renewables (wind and solar) rise to nearly 30% of global electricity generation by 2030—about double current levels.
Fossil Fuels, Nuclear, and Transition Risks
Even as renewables accelerate, fossil fuels and nuclear energy remain significant in most growth scenarios, but their roles are shifting.
The IEA WEO 2025 shows that:
- Coal and oil demand peak before 2030 in the Stated Policies Scenario, while gas demand plateaus in the mid‑2030s and remains roughly 10% above today’s level.
- Compared with older IEA outlooks, cumulative fossil‑fuel supply to 2040 is 8–11% lower, reflecting faster deployment of renewables and efficiency gains.
- Solar and wind capacity projections have increased dramatically in recent editions, while projections for coal and gas generation have been revised downward.
The Investor Bulletin on the IEA 2025 World Energy Outlook from ACCR stresses that renewables grow faster than any other major energy source in all IEA scenarios, but that there is still a significant gap between current policy trajectories and a 1.5 °C‑aligned, net‑zero path. You can reference this in Investor Bulletin: IEA 2025 World Energy Outlook.
At the same time, the IEA highlights an expanding role for nuclear energy, particularly to meet the electricity demand from data centres and AI. Iberdrola’s WEO 2025 summary notes that global interest in small modular reactors (SMRs) already totals up to 30 GW of potential capacity through MOUs and plans, and that in the STEPS scenario nuclear could add about 190 TWh by 2035 just to satisfy data‑centre loads.
Elcogen’s article, IEA World Energy Outlook 2025 Shows the Key Shifts Shaping Elcogen’s Market, underscores that roughly 80% of projected demand growth will occur in high‑solar regions, increasing the strategic importance of solar‑rich countries and technologies.
Investment, Policy, and Regional Growth Patterns
The energy sector growth forecast is tightly linked to investment flows and policy choices.
NextMSC notes that annual global investment in renewable energy could exceed USD 2.3 trillion by 2030, with major allocations to solar PV, wind, storage, green hydrogen, and batteries. Their report highlights China, the US, and the EU as leaders in building manufacturing capacity for solar modules, electrolyzers, and battery cells.
The Asian Development Bank’s Strategy 2030: Energy Sector Directional Guide emphasizes that Asia‑Pacific’s future growth will rely on low‑carbon, climate‑resilient energy systems, prioritizing renewables, energy efficiency, and grid modernization over new coal. You can quote this from the ADB PDF: Strategy 2030 Energy Sector Directional Guide.
The UN’s renewable‑energy brief reinforces that meeting global climate targets requires tripling renewable power capacity by 2030, significantly scaling up investment, and phasing down unabated fossil fuels.
ScienceDirect’s overview on Global Energy Demand summarizes the underlying drivers: population and economic growth keep pushing demand up, even as efficiency improvements and structural shifts (from heavy industry toward services and digital) change the energy mix.